Analysts at CardinalStone have assigned a “purchase” ranking to shares of Nigerian Breweries Plc, citing operational enhancements and a stronger stability sheet.
The advice was detailed of their fairness report revealed on August 21, 2025, titled “Nigerian Breweries Plc: Pricing within the Restoration.”
The analysts pointed to the corporate’s robust rebound within the first half of 2025 as a significant factor behind their stance, with earnings per share rising to N2.85 in comparison with a lack of N8.28 in 2024.
Whereas total volumes eased barely, CardinalStone expects festive demand, product improvements, and administration’s efforts to defend market management to raise income to N1.51 trillion in 2025, up from N1.08 trillion in 2024.
On innovation, they highlighted the launch of a brand new 45cl Heineken pack designed to strike a stability between affordability and premium positioning, which they consider will drive quantity development.
Supported by operational efficiencies and a extra steady FX outlook, CardinalStone set a goal value of N80.62 for the inventory, up from a reference value of N68.30, an implied upside of 18%.
Operational effectivity and steady FX:
Nigerian Breweries delivered stronger effectivity features within the first half of 2025, with its cost-to-sales ratio enhancing to 57.9% from 66.7% a 12 months earlier and effectively beneath its five-year common of 64.9%.
The brewer stated the progress was pushed by easing inflation, a extra steady trade charge, and ongoing cost-saving efforts, together with the swap from fuel to photo voltaic power at some breweries and elevated native sourcing of uncooked supplies, with almost all packaging now produced in Nigeria.
It expects additional financial savings from streamlining its distribution community, which ought to decrease logistics prices and help development throughout product segments.
- Reflecting these enhancements, margin forecasts have been revised upward, with gross margin seen at 42.5% (vs 39%) and EBIT margin at 20.2% (vs 19.2%), in keeping with the corporate’s H1 efficiency.
NB boosted its stability sheet after a rights problem that raised Heineken N.V.’s stake to 72.9% from 56.7%.
- The fairness funds had been used to clear international foreign money money owed, shifting the corporate from a $217.9 million internet legal responsibility in 2023 to a $42.1 million internet asset in 2024.
Administration stated this place was maintained in 2025, serving to NB submit a N7.3 billion FX acquire in H1.
With debt at multi-year lows and earnings enhancing, the brewer is now in a stronger place to handle prices, defend earnings, and keep financially versatile by way of the 12 months.
Market pattern:
Nigerian Breweries has maintained a bullish run in 2025 after struggling within the Nigerian inventory market all through 2024.
The inventory opened the 12 months at N32 and closed January increased at N35.80.
Though the rally slowed in February and March, momentum picked up strongly in April following the corporate’s Q1 outcomes, which confirmed a pre-tax revenue of N69.9 billion in comparison with a lack of N65.5 billion in Q1 2024, pushed largely by decreased FX losses.
Investor sentiment strengthened additional in Could and June, bringing the first-half efficiency to over 84%.
In Q3, the inventory surged by over 30% in July to shut at N77.05.
- Whereas it has since pulled again in August to N68.10, analysts view the dip as a possible entry alternative.
Yr-to-date, Nigerian Breweries shares have gained greater than 112%.
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